Dead man walking Sears is in a 'perpetual state of decline'

Sears said Thursday that its same-store sales fell
7.1% in the fourth quarter and revenue dropped 9.8% to $7.3
billion.

The company reported a quarterly loss of $580 million, or
$5.44 per share, compared with a loss of $159 million,
or $1.50 a share, the previous year.

Sears stores "now seem to be in aperpetualstate of decline," Neil
Saunders, CEO at retail consulting firm Conlumino, wrote in a
note to clients Thursday. "The underinvestment clearly
shows and as such they are caught in a vicious cycle of seeing
lower and lower customer traffic, which further weakens the case
for investment and reinvigoration."

"Because of Sears and Kmart's longstanding history and
cultural impact, we are targeted for criticism when our results
are poor," he wrote.

He acknowledged the disappointing performance, however,
saying, "We will continue to take strong, difficult but
necessary actions to reduce losses. We will have to think, work
and move harder and faster."

According to Evercore ISI analysts, a Sears recovery is
unlikely.

Sears is no longer "viable as a retailer in its current
form," the analysts wrote in a recent
note. “Sears margins were worse than we
thought as a tough retail climate accelerated margin
decline. A liquidity event is a matter of when not
if.”

The department store chain has been bleeding cash for
years. It has beenclosinghundreds of stores and selling off
real estate to stay afloat.